Imagine a world in which there were state-mandated middleman organizations that contracted for and controlled the recovery of all discarded resources; that were funded by large corporations according to a product’s market share; that didn’t pay taxes; that were exempted from antitrust laws; that contracted with today’s recyclers or somebody new as they wished; that paid recycling operators whatever they decided, maybe even zero; and that wouldn’t let recyclers charge service fees no matter what handling expenses they incurred. The monopolies wouldn’t actually own the resources, they would simply control the industrial structure and markets. Imagine that they could demand approval power over whether a recycling operator sold his or her business, and to whom. The overall goals: to make recycling more efficient, recover more resources, and provide more post-consumer resources to producers.

That’s the brave new world of EPR, much of which is in place in British Columbia, and which is even today helping US legislators write laws to bring us resource monopolies that might ask for exemption from antitrust laws. You can read most of this vision in a draft white paper from the new nonprofit Recycling Reinvented (RR). It was recently posted to the GreenYes listserv, so I have felt free to post it here, with only a few annotations.RR White Paper (PDF)

RR hopes the monopolies would consult with existing recyclers. Maybe rural areas would be serviced.

RR’s board of environmental heavy hitters consists of attorney Robert F, Kennedy, Jr., President of Waterkeeper Alliance and Clinical Professor and Supervising Attorney at Pace University School of Law’s Environmental Litigation Clinic; Kim Jeffrey, President and CEO of Nestle Waters of North America; Bill Shireman, formerly of Californians Against Waste and now of Future 500; and Conrad MacKerron, founder of the As You Sow Corporate Responsibility Program. The Executive Director is Paul Gardner, who served in the Minnesota House of Representatives from 2007 – 2011 and who was Executive Director of the Recycling Association of Minnesota from 1997 – 2006.

RR’s new Outreach Director, Melissa Innes, is resigning as a Maine legislator to take this job. She released the group’s draft EPR whitepaper on the GreenYes listserv. It describes most of the structure I outlined in the first paragraph, although I took a couple of those points from current events in British Columbia. BC is the international poster child for EPR achievement. But BC is looking for a site for its new proposed incinerator to supplement the one in Vancouver that now burns and therefore wastes 300,000 tonnes a year. Many BC communities already remove organics from their mixed discards, so what’s expected to be available for burning, post-EPR, that can support long-term contracts?

RR works on legislation and intends to help write the brave new rules. Ms. Innes doesn’t expect to recommend incineration. Nestle Waters North America is considered different from the Nestle corporation in the UK that is advocating more incineration of plastics.

Other EPR organizations include the Product Stewardship Council (PSC), which has the Covanta incinerator company on its board; and the Product Policy Institute (PPI), which has RR’s Melissa Innes on its board.

Regarding big-corporate control, PPI’s Matt Prindville said, “We need the corporations to save recycling because they are the only ones with capital.” So recycling needs to be “saved?”

Gird your loins, recyclers, if you want to keep control of your industry or even the resources you personally harvest. Or get ready to say “uncle,” and with a smile, too, if you want to stay in business. Bill Sheehan, PPI’s Executive Director, once asked Dr. Ore and me, “What do you care who you work for?”

2 Comments

Aunty Entropy craises important issues here about ownership of resources. The question of who owns recyclable resources is one that has lurked outside the normal discourse of recyclers. It’s time to start talking about it.

The recycling industry has traditionally relied on a unique type of resource: not “raw” resources, but resources with significant value-added. In fact, the greatest part of the value of the recycler’s stock-in-trade is the value-added. This is what makes recyclers different from mining companies. Recyclers tend to emphasize the social benefits of their business (“I work for the planet”) but there has been surprisingly little discussion of a vulnerability: an open question about the recycler’s right to access to discards.

The recycler’s access to discards is premised on a broad social tendency to consider discards as valueless. It is also presmised on a market in which manufacturers relinquish any sort of prior rights of their own to the materials to which they have added value. Manufacturers have with rare exceptions not attempted to exercise any claims on their discarded resources (Lexmark was an exception in the early 2000s when the company took measures to prevent remanufacturers from reselling Lexmark printer cartridges).

EPR is a threat to recyclers because it introduces the possibility that original brand owners may have prior right to the value-added in their discards. We feel comfortable with EPR for discards with negative value (toxic or useless products). But when EPR is extended beyond HHW to include discards with real value, recyclers rightly see a major disruption of their business.

My sense is that this will be a healthy challenge for the recycling business — as long as we make sure that public policy “works for the planet.” Public policy must include robust mechanisms to prevent abusive practices by monopolies, monopsonies that Aunty Entropy points to. We need to have a vision of a strong, diversified recycling industry operating with the protection of regulated access to discards. The original brand owner’s “rights” are constrained by the obligation to trade fairly, just as the recycler’s “rights” are constrained by the acknowledgement of the brand owner’s contribution to the value of a discard.

This is how we are going to get beyond boutique recycling, where a relatively small number of businesses and social enterprises operate at the margins of a vast tipping floor where most of the value added goes to waste.

Helen’s points are very interesting and are a sample of the discussion that is now going on with increasing intensity in the recycling industries. Helen sits on the board of an EPR advocacy organization, the Product Policy Institute (PPI). The version of EPR that this organization envisions calls for monopolies, or monopsonies as Helen wants to say to soften the blow. A monopsony is a market in which there is only one buyer, which sounds like a natural market structure instead of the mandated single buyer, or monopoly, that her organization’s version of EPR calls for.

The underlying question is who owns the product. I’ve always thought that when I bought toothpaste in a tube, or bought a table, I paid for both the resource and the value that the manufacturer added. I even paid enough for the manufacturer to make a profit for doing the work. The result: I have ownership and sole title of the toothpaste, the tube, and the table. It’s mine, mine, mine. When I toss it out, I am responsible for tossing it well – into the tax-funded water treatment system for the toothpaste (unless I have a septic tank), and into recycling for the tube, and into a reuser’s inventory in the case of the table. If the table is broken or is otherwise un-reusable, then I’m responsible for tossing it to a recycler, who will get the resource processed into something else. The reuser may be able to pay expenses and still make a profit without me paying for the service, but I’ll probably have to pay for the recycling service. That’s okay. It’s my object, my responsibility, and they’re doing it for me.

But if the manufacturer retains ownership of the product, then I’ve been only a renter of the product and don’t have ownership, or therefore control. One question: if I’m only a renter, why did I have to pay the manufacturer a profit? Why do I have any responsibility at all?

Assuming I have some human responsibility, which hasn’t been proven, I still haven’t owned the toothpaste or the tube or the table. The producer has to take back their product and do the right thing with it. My guess is the producer won’t want the toothpaste back. But for EPR to work the way PPI sees it, in the purchase price I’ve paid upfront for the producer to handle all disposal services. Seems to me the producer should pony it up for some of the water treatment system and maybe sewage system, as well as for whatever recycling service handles the tube. If I have a septic tank and the toothpaste is processed in my system, then the producer ought to give me a discount at the time of purchase, since I’ll be incurring all disposal cost, unless they ask me to separate out the used toothpaste from the rest of the water going down the drain. Unlikely.

Then there’s the table. PPI’s opinion is that producers should be held to the hierarchy of Reduce first, then Reuse, then Recycle. But how will that be enforced, and by whom? Who will monitor a producer that doesn’t want the table to be reused, since a used table might compete in the marketplace with the producer’s new table. If the producer still owns the table and I’ve merely been renting it, then I would have no control over whether it is reused. In British Columbia, one recycler I know has been expressly forbidden from salvaging for reuse and can reuse only items for which the owner has affirmatively requested reuse. In this case there’s an enforcement mechanism. If the EPR Steward catches the recycler salvaging for reuse, the Steward could cancel the recycler’s contract. It’s illegal in BC to sell those recyclables to anybody but the Steward.

It doesn’t make sense to me to let the producer retain ownership of the toothpaste, tube, or table while I’m using them. It violates a sense of – and need for – ownership that I thought was pretty universal to humans. Surely I wasn’t the only three-year-old who said, “You can’t take that, it’s MINE!”